Funding Advice Bureau SYFAB guide to... What is procurement? Procurement – contracting for public service delivery Procurement is when the public sector buys or contracts goods and services from the private or voluntary sectors. For the voluntary sector, this generally means the delivery of services under contract to local authorities, primary care trusts or other public bodies. SYFAB does not give detailed advice about procurement; however, this guidance and some of the organisations listed below might help you get started. Introduction The public sector refers to a variety of bodies and agencies, including: • The Executive and other Government agencies including non-departmental public bodies • The National Health Service, including local health authorities and Primary Care Trusts • Local Authorities • UK Government departments such as the Department of Work and Pensions • Key public services such as the police, fire service, judiciary • Further and Higher Education establishments. Procurement has been promoted by government and by some in the voluntary sector as one of the ways that voluntary and community organisations can generate income and become more sustainable and less reliant on grant funding. Government grants and contracts account for an increasing proportion of income for the voluntary sector, as public bodies are encouraged to purchase more and more from the voluntary and private sectors. One argument in favour of procurement is that the voluntary sector provides added value when it delivers public services as the providers are more closely connected to the service recipients and can better meet their needs. On the other hand, critics note that procurement is a form of privatisation and that voluntary sector organisations delivering public services may lose their independence. The reality is that, whatever your political views on procurement, it may be an option for some voluntary organisations to consider, but is not for everyone. If you are not already delivering a service that the public sector buys or would want to buy, then procurement is probably not for you. Deciding whether procurement is right for you There are a lot of questions to consider when deciding whether to get involved in providing services to the public sector. Your organisation should spend some time considering the issues before applying or tendering. What are your organisation’s aims? This includes both the formal information contained in your constitution and the informal understanding of the values and culture of your organisation. You should consider whether contracting for public sector business fi ts with your overall aims as an organisation, and whether there are any conflicts that would arise. How would taking on this contract contribute to your objectives? Are you chasing the money rather than chasing your aims? What are your organisation’s activities? Are you already delivering a service that the public sector needs or wants to buy? And can you supply that service at a higher quality or more efficiently than competitors? Remember that if you tender to deliver a service, you will need to demonstrate how your skills, activities and experience make you the best organisation for the job. Do you have enough capacity? Do you have the necessary systems, staff and management in place to allow you to go through the tendering process and to deliver the contracts? What impact will this have? What impact will delivering public services under contract make to your organisation? Will there be a signifi cant difference between staff working on contracts and staff working on grant-funded work? Will there be an impact on your service users? Will this change your organisational culture? What are the financial and legal implications? Consider the length of the contract, the costs that will be covered and whether you will continue to raise money and deliver services other than those under the contract. Are you moving from grant-dependency to contract- dependency? Does entering into a contract agreement make you liable for VAT or other taxes? You should also consider whether carrying out the contract would constitute trading and if this does not fall within your primary purpose, do you need to set up a sepaprate trading subsidiary? The Charity Commission produces guidance to help answer these questions. Website: www.charity-commission.gov.uk/publications/cc37.asp Finding procurement opportunities First of all, how do you find out about procurement opportunities? A good start would be to find and maintain good contacts at the public sector bodies doing work that you are involved in. For example, if your organisation provides health related activities, you should ensure you have contacts at your local Primary Care Trust. Many statutory authorities employ contracting/procurement officers. You may already have a direct relationship with public bodies, for example, clients of health services or social services might get referred on to your organisation. Or the link might be less direct; the work you do might have a knock-on effect on public services, for example, preventative health work. To contract with the public sector, you will have to make a strong case for the work you do and why the public sector should pay for it, so the more thought you’ve given to how your work complements and supports public service delivery, the better. Most of the references below are places you can fi nd out about specific goods or services that are being put out to tender. However, for many local groups delivering specific services and activities, a better approach would be to get in touch with the relevant officer or member of staff at whichever public body does or could benefi t from the services you provide. You should make sure they are aware of you and your work, so that if there are likely to be opportunities for procurement of public services in your area of work, you will get to hear about them. Sources of tender opportunities The Supplier and Contract Management System carries tender information from all local authorities in Yorkshire. Suppliers can register with the site, upload their details, and search for relevant tenders. Tender details can also be downloaded, and tenders submitted electronically. Organisations interested in public sector procurement can see what contracts are currently available and which contracts have been awarded. Website: http://scms.alito.co.uk Each individual local authority also has some information on procurement online: • Barnsley MBC Website: www.barnsley.gov.uk/bguk/Economic_Finance/ Property_Procurement/Contract_and_Procurement • Doncaster MBC Website: www.doncaster.gov.uk/Living_in_Doncaster/ The_Mayor_and_Council/supplying_the_council/ Supplying_the_Council.asp • Rotherham MBC Website: www.rotherham.gov.uk/info/200095/tenders_ and_contracts • Sheffield City Council Website: www.sheffi eld.gov.uk/business-economy/ contracts Other bodies like Primary Care Trusts, Colleges and Universities may well also have some information on procurement on their websites. You could find the relevant website and do a keyword search for ‘procurement’. In general, finding out about opportunities and being invited to tender needs a combination of research about likely agencies and bodies and networking to build relationships with relevant organisations including staff at public bodies. There are various other places that contract opportunities are advertised; be aware that some of these are likely to be more relevant for organisations working regionally or nationally. • Newspapers and trade journals • Funding Central, the government-funded website, has information on tender opportunities Website: www.fundingcentral.org.uk • The Official Journal of the European Union (OJEU) publishes almost all public procurement contracts over a specified EU threshold in the Supplement to the Offi cial Journal (OJS), which has an online version called Electronic Tenders Daily (TED). Website: www.ted.eur-op.eu.int • The website www.supply2.gov.uk enables organisations to register and receive notification of smaller value procurement contract opportunities. • The Bluelight website has tender information from the emergency services Website: www.bluelight.gov.uk • The Buying Solutions website has information on procurement opportunities across government. Website: www.buyingsolutions.gov.uk • ‘Meet the Supplier’ events. Events are sometimes organised by local authorities usually in relation to planned regeneration developments or initiatives. The events aim to bring together purchasers of services with potential suppliers and may be a useful way to fi nd out about potential contract opportunities. The procurement process There is no standard approach to procurement so there is no one way to get involved or tackle it. Each public body will have its own procedures for tendering for contracts. Local authorities engaging in procurement have to follow a ‘Best Value’ approach which is a shift from just going for the cheapest option to balancing price and quality to ensure value for money. In principle, it is supposed to ensure that services are high quality and responsive to need, not just the cheapest. The voluntary sector can in theory add value to the delivery of public services through its responsiveness to local need and involvement of local communities. You should recognise, however, that with limited budgets available, the balance may well still be heavily in favour of price. Once you have found a tender opportunity, you should make sure you have all the relevant tender documents. Also, make sure you are familiar with the procurement guidelines of the public body – you can contact the procurement department of the relevant agency for this. Local sources of information and support Business Link Yorkshire may be able to offer some advice to organisations looking to expand their business activities into contracting with the public sector. Website: www.businesslink.gov.uk/yorkshire Amongst the South Yorkshire CVSs, Voluntary Actions Rotherham and Sheffield have procurement support projects. The Rotherham project supports organisations that want to secure contacts with NHS Rotherham; the Sheffield project can support any voluntary and community organisation in the Sheffield area and any infrastructure organisation across the South Yorkshire Sub Region considering getting involved in procurement. Voluntary Action Rotherham Tel: 01709 834 468 Website: www.varotherham.org.uk Voluntary Action Sheffield Telephone: 0114 253 6600 Website: www.vas.org.uk Other sources of information National Council for Voluntary Organisations (NCVO) has produced various publications and guidance, available on the NCVO website. Website: www.ncvo-vol.org.uk/psd NAVCA Local Commissioning and Procurement Unit Website: www.navca.org.uk/localvs/lcp South Yorkshire Funding Advice Bureau The Workstation 15 Paternoster Row Sheffi eld S1 2BX Tel: 0114 249 4343 Email: enquiries@syfab.org.uk Website: www.syfab.org.uk We can provide this information in other formats on request. 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